The Reserve Bank of India (RBI) is now looking at strengthening local institutions like co-operatives, regional rural banks (RRBs), urban co-operative banks (UCBs), small banks and self-help groups (SHGs) in a bid to bring in more people into the financial fold, its deputy governor, Usha Thorat said on Wednesday.
Addressing a seminar conducted by City of London office on Financial Inclusion ? sharing Indian and UK Experience, in the city, she said: “There has been a significant increase in authorisation by RBI in branch network in rural and semi-urban areas of the country. This has helped to bring in financial soundness.”
Thorat said there was a need for maintaining a proper track record and efficient credit information system to minimise defaults. Thorat advocated the usage of banks, post offices and NBFCs to promote the bank’s business correspondents model in rural belts of the country.
She said RBI is also encouraging banks to adopt IT-based solutions to improve technology and make sure agency risks are minimised.?City of London Mayor Alderman David Lewis said, “In a small and a developed country like the UK, about 20 lakh people yet do not hold a bank account. Thus, financial inclusion is a challenge for both, developing and the developed economies of the world.”